HARRISBURG, Pa. (WHTM) – A former Rite Aid executive and a New Jersey businessman will serve time in a federal prison for a $12.9 million fraud and kickback scheme.
Former Rite Aid vice president Timothy P. Foster was ordered to serve 60 months in prison at his sentencing Wednesday, according to U.S. Attorney Bruce Brandler.
Foster, 66, of Portland, Oregon, pleaded guilty in February 2015 to making false statements to authorities.
Jay Findling, 55, of Manalapan, New Jersey, was sentenced to 48 months in prison. He had pleaded guilty to conspiracy to commit wire fraud.
The men were ordered to jointly pay about $8 million in restitution. Findling forfeited an additional $11.6 million when he entered his guilty plea.
Brandler said between 2001 and 2010, Foster and Findling made Rite Aid believe its surplus inventory had been sold to Findling’s company for amounts reported by Foster, but the inventory was sold to third parties for greater amounts.
He said Findling made a profit of about $29.1 million from the scheme and kicked back $5.9 million to Foster.
U.S. District Judge John Jones concluded the total loss to Rite Aid was $12.9 million.